WTI Crude Oil (FRED)

The three-pillar structure remains intact and strengthening: (1) Energy-driven inflation shock — WTI at $104-111, +40% in 1M, flowing through PPI (+0.7% 3M, accelerating) into a CPI/PCE pipeline that has not yet absorbed the full pass-through, with 5Y breakevens at 2.57% and rising; (2) Growth deceleration — consumer sentiment at 56.6, housing stagnant, financial conditions tightening at an accelerating pace (+58.75% 1M on StL Stress Index), saving rate at 4.5% as consumers face a real income squeeze from energy costs; (3) Geopolitical supply shock embedding permanence — Operation Epic Fury is a kinetic military exchange (US strikes Iranian infrastructure, IRGC announces retaliation on US facilities), the Hormuz physical disruption tail at 20-25% probability cannot be hedged away. WTI AV at $111.54, FRED WTI at $104.69 (+40.37% 1M), Brent at $121.88 (+49.44% 1M) — extraordinary 1M moves confirming a structural regime shift in energy pricing. The 3-6 month inflation pass-through from sustained $100+ WTI is NOT YET fully in the lagging CPI/PCE data.

Recent Data